The leaders of seven countries of South and Southeast Asia -
Bangladesh, Bhutan, India, Myanmar, Nepal, Sri Lanka and Thailand -
gathered in Naypyidaw, Myanmar last month to take part in the third
Bay of Bengal Initiative for Multi-Sectoral Technical and Economic
Cooperation (BIMSTEC) summit.

BIMSTEC was set up in 1997 as an expression of the convergence of
economic interests coming out of India's Look East policy and
Thailand's Look West policy. Its objective was to integrate the
regions on both sides of the Bay of Bengal. Representing one fifth of
the world's population, including nearly a third of its poorest
members, the bloc's member states are

demographically young,
politically evolving and ethnically diverse.

At the recent summit, they were deliberating over three key issues:
development, connectivity and economic integration. Though the BIMSTEC
nations are rich in resources, they remain underdeveloped and
disconnected from Asia's growth story. And even though the member
states are connected via regional cooperative processes, they have
remained on the margins of Asian market integration.

The third summit saw three important decisions. First, the member
states agreed to set up a permanent secretariat in Dhaka, Bangladesh,
with Sumit Nakandala, a veteran diplomat from Sri Lanka, as its first
secretary general. Until now, BIMSTEC has been run largely through the
foreign-affairs offices of its member countries. The secretariat will
provide a platform for more effective debate on the priorities of the
bloc.

The second important decision was for BIMSTEC states to expedite
negotiations on a free-trade agreement (FTA) in goods by the end of
2014. A BIMSTEC FTA would create an integrated market of 1.5 billion
people with a combined economic strength of US$2.5 trillion. But
member states, even after 19 rounds of FTA negotiations stretching
over 10 years, have not been able to reach a consensus over issues
like market access or a dispute-settlement mechanism. his is in
contrast to the FTA between the Association of Southeast Asian Nations
(ASEAN ) and India, which was proposed in 2003 and came into effect in
2010.

Third, the BIMSTEC states established a network of policy think tanks,
a welcome step that was suggested by the Indian government during the
second summit in 2008 in New Delhi.

BIMSTEC's two challenges
Notwithstanding these decisions, the group continues to be an
underperformer, with vital elements of cooperation remaining
incomplete. BIMSTEC's limited accomplishments can be attributed to two
critical problems: lead-actor inertia; and structural constraints on
member states in the form of limited technological, financial and even
operational capabilities.

First, New Delhi's contribution to the bloc has not been commensurate
with its place in it. India is the lead actor in BIMSTEC, representing
more than two-thirds of its constituency, and thus assumes greater
responsibilities. New Delhi has sought to use the group as a platform
for the development of its landlocked and troubled northeastern states
and their integration with Southeast Asia, for the building of
stronger ties with Bangladesh and Myanmar, and for the extraction of
the vast energy resources available within the sub-region. But these
projects remain incomplete.

Moreover, India's intellectual contribution to the growth of BIMSTEC
has been sub-optimal. BIMSTEC has not emerged as a priority forum for
India, and has been overwhelmed by the debates in the South Asian
Association of Regional Cooperation (SAARC ) and ASEAN. Discussion
about BIMSTEC in the Indian strategic community has also been limited,
cursory and somewhat episodic in nature. As a result, the group has
remained marginal to the integrative discourse in South and Southeast
Asia.

Second, structural constraints, in the form of limited state
capabilities of the majority of its member countries, have also
stymied the growth of the group. The majority of the BIMSTEC countries
are technology deficient and lack the resources to invest in
development and infrastructure projects, with Bangladesh, Bhutan,
Myanmar and Nepal among the world's least developed countries.

Nepal and Thailand have also experienced sustained political
instability during the last five years. Nepal has yet to finalize its
constitution, and Thailand not only changed its constitution in 2008
but has also endured another bout of political instability since
December. The absence of Thai Prime Minister Yingluck Shinawatra from
the March summit meeting amplified Bangkok's internal preoccupation
and its inability to contribute substantially to BIMSTEC.

Remedy: expand BIMSTEC eastward
It is time that BIMSTEC begins to address its limitations, which are
impeding critical initiatives. An important step in this direction
would be to expand the group by incorporating technologically advanced
countries from the east either as new members or as observers. BIMSTEC
can start this by incorporating both Malaysia and Singapore, situated
on the eastern rim of the Bay of Bengal. They would bring new momentum
to the group by considerably expanding its capabilities to undertake
substantial developmental, connectivity and energy projects.

Admittedly, this is not a new idea, with such suggestions for the
expansion of BIMSTEC having been made in the past. This is not
surprising when we consider that both Singapore and Malaysia possess
advanced technologies and capabilities that could play an important
role in the accomplishment of two critical objectives of the bloc -
the development of infrastructure and energy projects, and the
expansion of the skill and technology base of member states. And
Singapore and Malaysia have a proven record of their willingness and
capability to invest in the Indian market, especially in the
infrastructure and construction sectors. These ASEAN members also have
considerable experience in engaging cooperatively with other
countries.

For its part, BIMSTEC offers ASEAN countries a much bigger market.
Bangladesh, India's northeastern states, and Myanmar are rich in
energy resources, especially hydro power and natural gas. And the
countries of East Asia have long wanted to enter the larger South
Asian market. BIMSTEC provides that opportunity without the hassle of
getting into the Indian-Pakistani vortex.

A major thrust of BIMSTEC is connecting South Asia with Southeast Asia
via Myanmar. The participation of ASEAN countries in BIMSTEC
connectivity projects would speed that process up while also promoting
intra-ASEAN connectivity.

Finally, the geographical composition of BIMSTEC has remained
overwhelmingly South Asian. The presence of Malaysia would give more
legitimacy to the idea of a community that covers the entire arch of
the Bay of Bengal.

The bloc can later on consider incorporating the more efficient
countries of Northeast Asia - China, Japan and South Korea - as
observers. Both China and Japan have shown interest in joining hands
with India and other BIMSTEC member states. Japan is already an
important economic player and stakeholder in Myanmar, and has
contributed significantly toward developing ASEAN connectivity.

A win-win arrangement
The idea of incorporating new members from East Asia is a win-win
formula. It offers an expanded market for the East Asian economies,
and a much-needed push towards greater integration for South and
Southeast Asia.

At this juncture, it seems impossible for BIMSTEC to address its key
developmental and integration challenges without receiving substantial
resources and technological assistance from the east. The inclusion of
East Asian nations will also bring much-needed business skill and
efficiency into BIMSTEC.

Above all, such a partnership would give the advanced economies of
Asia an opportunity to mobilise their resources to address the needs
of the continent's poorest citizens.

Dr Vibhanshu Shekhar is visiting fellow at the Institute of Peace and
Conflict Studies, New Delhi, and is currently based in Washington DC.
Dr Shekhar previously worked as a research fellow at the Indian
Council of World Affairs in New Delhi.